U.S. Private Sector Adds More Jobs Than Anticipated In January

1/30/2013 9:25 AM ET

Private sector employment in the U.S. increased by more than anticipated in the month of January, according to a report released by payroll processor Automatic Data Processing, Inc. (ADP) on Wednesday.

The report showed that private sector employment increased by 192,000 jobs in January compared to economist estimates for an increase of about 172,000 jobs.

However, ADP also said that the job growth in December was downwardly revised to show an increase of 185,000 jobs compared to the addition of 215,000 jobs that was originally reported.

Mark Zandi, chief economist of Moody's Analytics, said, "The job market is slowly, but steadily, improving. Monthly job gains appear to have accelerated from near 150,000 to closer to 175,000."

"The recent gains may be overstating any improvement, particularly in the context of recent revivals in growth at the start of the past three years, but the gains are encouraging nonetheless," he added.

The better than expected January job growth was largely due to an increase in employment in the service-providing sector, which added 177,000 jobs.

Employment in the goods-producing sector increased by a more modest 15,000 jobs, with the loss of 3,000 manufacturing jobs partly offsetting an increase of 15,000 construction jobs.

The report also showed a notable increase in employment at small businesses, which saw an increase of 115,000 jobs in January. Medium-sized businesses also added 79,000 jobs, while large businesses cut 2,000 jobs.

Friday morning, the Labor Department is scheduled to release its closely watched monthly employment report, which includes both private and public sector jobs.

Economists expect the Labor Department report to show an increase of about 180,000 jobs in January following the addition of 155,000 jobs in December.

The continued job growth is expected to push the unemployment rate down to 7.7 percent from 7.8 percent in the previous month.